As shorting demand decreases, this is what Bitcoin has in store for investors

ambcrypto.com:

The price action of Bitcoin hasn’t witnessed much stability in the last few weeks. The constant fluctuation in price has frustrated the market to an extent where a section of investors is actually wishing that the price falls further down. 

On-chain data has indicated that there has been quite an increase in investors looking to short the king coin in the last couple of days. That goes to say about the significant demand for short interest in Bitcoin.

This shorting interest has risen by 329.66% in the last week alone. And, the consequences of the same have been visible on the king coin’s performance. 

Bitcoin Price Action | Source: TradingView – AMBCrypto

Due to the recent shorting, the average funding rate has turned negative. The indicator in the chart below is revisiting the negative zone which is a good sign. Notably, around the first week of March, funding rates were worse.

Bitcoin Funding Rate | Source: Santiment

It’s also interesting to note that up until the first week of March, the crypto-margined Futures contracts were observing a downtrend.

Unlike stablecoin margined Futures contracts, crypto-margined contracts are vulnerable to a price fall. In such a situation, not only do they lose their profits, but they also lose the value of the asset.

Stablecoin margined contracts, on the other hand, are immune to losing value. These are only preferred by long traders. Shorting them leads to immediate liquidation since they can’t be hedged.

As a result, crypto-margined contracts came down by 27% in 10 months. However, their recent increase might be indicative of the fact that investors are gaining confidence in Bitcoin once again.

Otherwise, there is no reason investors would dare to pull off such a stunt in the midst of a